Every UK employer running PAYE has to report pay to HMRC online, on or before each payday, and give each employee a payslip. Payroll software does the reporting; the payslip is sometimes an afterthought. This post compares the options a business with a handful of staff is likely to look at, using prices from each provider's own pages, and separates the two jobs so you don't pay for more than you need.
What payroll software has to do
GOV.UK says you must get payroll software that reports PAYE information online, unless you're exempt. It also warns that some software won't let you produce payslips or record pension deductions, so check features before you buy. HMRC does not recommend one product over another.
- Work out PAYE income tax and National Insurance from each employee's tax code and category letter.
- Send a Full Payment Submission (FPS) to HMRC on or before each payday, and an Employer Payment Summary (EPS) when you need to claim or report something.
- Handle starters, leavers (the P45) and the year-end P60.
- Deal with workplace pension deductions if you have staff to auto-enrol.
- Produce a payslip for each employee on or before payday.
The first four are the HMRC side. The last one is your duty to the employee, and GOV.UK says an employer can choose printed or electronic payslips.
Full Payment Submission (FPS) Employer Payment Summary (EPS)
UK payroll software compared
| HMRC Basic PAYE Tools | Moneysoft Payroll Manager 20 | QuickBooks Payroll Core | Xero Grow | BrightPay | |
|---|---|---|---|---|---|
| Published price | Free | £95 a year + VAT | £5 a month + £1.50 per employee | £39 a month + VAT (90% off for 6 months for new customers) | Priced by employee count through its calculator |
| Employees | Fewer than 10 | Up to 20, one employer | Per active employee | 1 included, then £1.50 each | Per highest recorded number |
| Reports to HMRC (RTI) | Yes | Yes | Yes | Yes | Yes |
| Payslips | Not described on its GOV.UK page | Yes | Yes, created and distributed | Yes, emailed or in the Xero Me app | Yes, emailed or in its employee app |
| Comes with accounting software | No | No | Added to a QuickBooks plan | Yes | No |
| Platform | Download (Windows, macOS, Ubuntu Linux) | Windows 11 only | Online | Online | Cloud only from 2026/27 |
Checked 4 October 2026. From each provider's own pricing or help pages (sources below). QuickBooks' help article lists the fees without a VAT note. BrightPay publishes no fixed cloud price on its pricing page. Xero's cheaper Ignite plan charges £1.50 per person for payroll. Sage also sells payroll, from £12 a month plus VAT for Payroll Essentials (up to 5 employees) on its UK pricing page; it is compared in our post on the cheapest UK payroll software.
For one to three employees, a year costs nothing with Basic PAYE Tools, £114 with Moneysoft including VAT, £78 to £114 with QuickBooks Payroll Core (plus the QuickBooks plan it sits on), or £468 plus VAT with Xero Grow at its full price, which also covers your bookkeeping.
Which kind of business suits which option
| Your situation | Look at first | Why |
|---|---|---|
| Fewer than 10 staff, simple pay, comfortable with HMRC's screens | Basic PAYE Tools | Free and from HMRC, but no frills and not built for agents |
| Up to 20 staff, a Windows PC, want a one-off yearly cost | Moneysoft Payroll Manager 20 | Fixed yearly licence, desktop software |
| You already keep your books in QuickBooks or Xero | Their payroll add-on or plan | Wages post straight into your accounts |
| You want everything in the cloud with accountant access | BrightPay, Xero, QuickBooks | Online access from any device |
| Your payroll software already reports to HMRC but the payslip is poor or missing | A payslip tool | GOV.UK says you can use different software for payslips |
When a payslip tool is enough
A payslip tool is never a replacement for RTI reporting. If you employ people through PAYE, something has to send the FPS to HMRC. But many micro employers already have that covered: a director-only company whose accountant runs the RTI, a family paying a nanny through Basic PAYE Tools, or a shop using software whose payslips staff can't read.
In those cases the gap is the document, and you can fill it without changing your payroll software. A payslip has to show pay before and after deductions, the deductions that change each time (tax and National Insurance, for example), and hours worked if pay varies with time. Fixed deductions can be shown on the payslip or in a separate yearly statement.
Where PayDocs fits
PayDocs makes UK payslips from your payroll figures, in six layouts. PayDocs works out PAYE income tax, National Insurance and supported deductions for 2026/27 pay dates. It does not send anything to HMRC, run auto-enrolment or move money. Keep your payroll software for the HMRC side.
Creating and previewing a payslip is free. The finished PDF is £3.99 once checkout opens, or less per document in packs of 4 or 12, with no subscription.
A PayDocs payslip records pay you have already run through payroll. It is not proof of income and is not checked by HMRC.
Questions
Is there free payroll software for small businesses in the UK?
Yes. HMRC's Basic PAYE Tools is free for businesses with fewer than 10 employees. It works out tax and National Insurance and sends the information to HMRC.
What is the cheapest paid payroll software in the UK?
On the providers' own pages on 4 October 2026, Moneysoft Payroll Manager 20 was £95 a year plus VAT for up to 20 employees, and QuickBooks Payroll Core was £5 a month plus £1.50 per employee, added to a QuickBooks plan.
Does payroll software have to produce payslips?
No. GOV.UK notes that some payroll software won't produce payslips. You still have to give each employee one on or before payday, and you can use different software to make it.
Can PayDocs replace my payroll software?
No. PayDocs makes payslips, but it doesn't report to HMRC. You still need software, such as Basic PAYE Tools, for RTI.
Sources
- GOV.UK, Payroll software
- GOV.UK, Basic PAYE Tools
- GOV.UK, Payslips
- Moneysoft, prices (checked 4 October 2026)
- QuickBooks UK, payroll billing change and fees (checked 4 October 2026)
- QuickBooks UK, pricing (checked 4 October 2026)
- Xero UK, pricing plans (checked 4 October 2026)
- BrightPay, cloud pricing FAQs (checked 4 October 2026)
- BrightPay, email payslips
- Xero, set up and email payslips to employees (UK)
Sources checked 4 October 2026. This article explains how pay documents work; it is not tax or legal advice.
